Helming Agriculture Outlook

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LIVESTOCK:

DAILY DRESSED BEEF OUTLOOK

07/23/99 PM: BEEF TRADING MONDAY WILL BE SLOW. SALES ARE EXPECTED TO BE AVERAGE FOR A MONDAY. PRICES WILL BE STEADY TO FIRM AND CUTOUTS LIKELY UP SLIGHTLY. OFFERINGS WILL BE MODERATE IN SPITE OF AN EXPECTED LARGE SATURDAY SLAUGHTER. PACKERS MOVED GOOD VOLUME THIS PAST WEEK ON TWO COUNTS. VOLUME WAS GOOD CONSIDERING THE RELATIVELY HIGH LEVEL OF PRICES AS WELL AS BEING ADEQUATE TO PREVENT INVENTORY FROM BUILDING APPRECIABLY. RETAIL BUYING INTEREST WILL BE FAIR TO GOOD. INTEREST FOR LABOR DAY DELIVERY SHOULD INCREASE DURING THE WEEK. SLAUGHTER ESTIMATE: 129,000

DAILY FED CATTLE OUTLOOK

07/23/99 PM: NO CASH TRADE IS EXPECTED MONDAY. ASKING PRICES WILL LIKELY START AT 67 AND 104 DOLLARS. BIDS ARE EXPECTED TO BE MAINLY 64 AND 101 DOLLARS. THE MARKET MAY NOT ESTABLISH UNTIL WEDNESDAY BUT SOME TRADE TUESDAY IS POSSIBLE IF PACKERS RAISE BIDS TO STEADY. MARKET UNDERTONE GOING INTO THE WEEK WILL BE STRONG. PARTLY DUE TO GOOD CLEAN OF SHOWLISTS PAST WEEK AND PARTLY DUE TO TIGHT SUPPLIES OF CHOICE CATTLE AGAIN NEXT WEEK. STRONG FUTURES AND THE GOOD BEEF MARKET ARE ALSO POSITIVE. CORNBELT: 63-64.50/100-102 KANSAS: 64-65 TEXAS: 64-65

DAILY FEEDER CATTLE OUTLOOK

07/23/99 PM: HIGHER CORN PRICES FRIDAY WILL SOFTEN BUYER ENTHUSIASM FOR FEEDER CATTLE MONDAY. BUT, LIGHT RECEIPTS WILL CONTINUE TO SUPPORT MOSTLY STEADY PRICES. CORN MARKET'S BIGGEST WORRY IS APPARENTLY FOR THE EASTERN CORNBELT CROP. FORTUNATELY, GRAZING CONDITIONS ARE GENERALLY STILL OKAY IN THE MAJOR GRAZING AREAS AND FORCED MARKETING DUE TO DROUGHT IS NOT EXPECTED ANYTIME SOON. HOWEVER, FEEDER PRICES WILL EVENTUALLY COME DOWN IF CORN PRICE CONTINUES HIGHER. PLAINS: 75-83 CORNBELT: 77-86

DAILY HOGS/PORK OUTLOOK

07/23/99 PM: PRICES FOR HOGS MONDAY WILL BE STEADY TO HIGHER. HEAT IS FORECAST TO CONTINUE THROUGH EARLY NEXT WEEK. HOG MOVEMENT MONDAY WILL BE ERRATIC BETWEEN REGIONS BUT IN TOTAL WILL BE LIGHT TO ONLY MODERATE. PACKERS MARGIN WILL BE STARTING THE WEEK STILL NEGATIVE BUT WILL NOT BE AS BAD AS WEEK EARLIER. PORK OFFERINGS MONDAY WILL BE LIGHT. PRICES ARE EXPECTED STEADY TO HIGHER AS SLAUGHTER LEVELS REMAIN AT LOWER LEVEL THROUGH THE WEEK. SLAUGHTER ESTIMATE: 334,000 WI CARC: 32-48 WT: 28-32 EI CARC: 35.50-47.50 ET: 30.50-31

DAILY TECHNICAL COMMENTS 07/23/99: NOT ISSUED FRIDAYS.

WEEKLY TECHNICAL COMMENTS

FOR THE WEEK OF 07/26-07/30: BEEF COMPLEX:

OUTLOOK FOR THIS WEEK'S PRICES IS STEADY. PRICES ARE EXPECTED TO START TRADING IN THE 64-65 AND 101-102 DOLLARS RANGES. HOWEVER, CLOSING PRICES WILL WEAKEN 1 DOLLAR AS PACKERS LOWER BIDS TO REFLECT DECLINING BEEF PRICES. BEEF HAS CONTINUED MOVING WELL AT PRICES ONLY SLIGHTLY LOWER. PACKERS CONTINUE TO HOLD VERY GOOD MARGIN. RETAILER BEEF FEATURING IS EXPECTED TO EVENTUALLY TAPER OFF IN FAVOR OF CHEAP PORK AND CHICKEN. BUT, EVIDENTLY CONSUMER BUYING OF BEEF IS STILL GOOD AND RETAILERS ARE KEEPING BEEF DOMINANT IN THEIR PROMOTIONS. FUTURES WILL START THE WEEK REACTING TO THE TWO FRIDAY CATTLE REPORTS, THE JUL 1 ON FEED AND JUL 1 CATTLE INVENTORY. JUNE MARKETINGS ARE EXPECTED LARGE, BULLISH FOR AUGUST, BUT PLACEMENTS ARE ALSO EXPECTED LARGE, BEARISH OCT-DEC. INVENTORY EXPECTED DOWN 1-2 PERCENT AND BULLISH FOR NEXT YEAR'S PRICES.

PRICE OUTLOOK FOR CASH HOGS THIS WEEK IS MOSTLY STEADY. HOG SUPPLY HAS TIGHTENED SLIGHTLY BUT PORK SALES REMAIN LACKLUSTER. UNLESS PORK SALES PICK UP BECAUSE OF INCREASED BUYING ACTIVITY, CASH HOG PRICES WILL STRUGGLE JUST TO HOLD STEADY. PACKERS MARGIN HAS IMPROVED BUT IS NOT EXPECTED TO IMPROVE MUCH MORE AND THEREFORE WILL NOT LIKELY GET PACKERS INTO THE BLACK. EVENTUALLY, RETAILERS WILL BEGIN FEATURING PORK MORE OFTEN AND MORE ATTRACTIVELY PRICED. BUT FOR NOW, THEY CONTINUE TO PROMOTE BEEF ACTIVELY. FUTURES THE PAST WEEK TRIED TO RECOVER SOME OF THE RECENT PRICE DECLINE. BUT, ACTUAL RECOVER WAS MODEST. PRICES ARE EXPECTED TO CONTINUE VOLATILE AGAIN THIS WEEK. THE VOLATILITY MAY BE A SIGNAL FOR ADDITIONAL RALLY. HOWEVER, CURRENT CASH MARKET IS NOT PROVIDING MUCH SUPPORT FOR A STRONG RALLY.

07/23/99 PM: SEPT CORN FUTURES: CLOSE UP 2 CENTS MONDAY. ON THE BASIS OF FORECAST MODELS LATE FRIDAY MORNING, IT WILL BE HOT AN DRY THROUGH AUGUST 6, BUT MODELS CAN AND WILL CHANGE. BY THE MIDDLE OF NEXT WEEK, FUNDS WILL HAVE COVERED MUCH OF THEIR SHORT POSITIONS. WILL THEY TURN TO THE LONG SIDE INTO HARVEST? A SURPRISE RAIN MEANS LIMIT DOWN ON MONDAY, BUT WE WILL GO WITH THE FORECAST FOR A DRY WEEK AHEAD. PRODUCER SALES WILL INCREASE AS 1.18 BILLION BUSHELS OF CORN MATURES UNDER LOAN. ON AN UP MARKET, THE PCP'S LAG BEHIND THE MARKET MAKING IT EASIER FOR PRODUCERS TO REDEEM THE LOAN AND HAVE A SMALL POSITIVE CASH FLOW WHICH IS IMPORTANT WITH PRICES THIS LOW. A WEEK FROM TODAY WE WILL BE IN THE FIELDS GETTING A FIRSTHAND LOOK AT THE CROP.

DAILY SOYBEAN OUTLOOK

07/23/99 PM: SEPT BEAN FUTURES CLOSING CALL: UP 3 CENTS MONDAY. SOYBEANS WILL WAIT UNTIL EARLY AUGUST FOR RAIN, SO IT IS PREMATURE TO WRITE THEM OFF IN JULY. THEY ARE AN AUGUST CROP. A SURPRISE RAIN WOULD CAUSE A SHORT-TERM TOP BUT A HOT-DRY FORECAST CONTINUES THE STRENGTH. IF PRICES CONTINUE HIGHER AND SURPASS $5.00, THE SOUND YOU HEAR IS PRODUCERS CHEERING IN SOUTH AMERICA. THEY WILL BE ENCOURAGED BY THE HIGHER PRICES AND THIS WOULD HELP THEM DODGE THE LOW PRICE BULLET. PRICES ARE ALREADY DISCOUNTED TO LOWEST LEVELS SINCE THE 1970'S AND DEFLATED PRICES WERE $1.50 TO $2.50 PER BUSHEL LAST WEEK, DEPENDING UPON THE BASE YEAR YOU WANT TO USE FOR INFLATION. DEMAND IS EXPECTED TO INCREASE AS USDA ALREADY HAS PROJECTED RECORD CRUSH AND EXPORTS FOR 1999-2000.

DAILY WHEAT OUTLOOK

07/23/99 PM: CHICAGO SEPT WHEAT FUTURES CLOSING CALL: UP 1 CENT MONDAY AND KANSAS CITY SEPTEMBER FUTURES CLOSING CALL: UP 1 CENT MONDAY. WHEAT IS A FOLLOWER AT THIS POINT. ANY TOP IN BEANS OR CORN WILL PRESSURE WHEAT. HEAT CAN REDUCE TEST WEIGHTS AND YIELDS FOR SPRING WHEAT WHEN IT IS HEADING OUT. WINTER WHEAT IS ALREADY MADE AND FINAL ESTIMATES ARE LIKELY TO BE LARGER. USDA TENDERS FOR 475,000 TONNES OF WHEAT THIS WEEK FOR DONATIONS. THE WHITE HOUSE SAID THAT A DECISION TO OFFER MORE FOOD AID TO RUSSIA WILL BE MADE AT A LATER TIME AS THERE IS STILL UNSHIPPED AID FROM LAST YEAR. RUSSIA WILL HAVE PLENTY OF GRAIN NOW AS IT IS HARVEST TIME. ONCE AGAIN, SHORTAGES WILL BE IN MAY-JULY, 2000 FOR FOODGRAINS AND DURING THE WINTER FOR FEEDGRAINS.

DAILY COTTON OUTLOOK

07/23/99 PM: OCT FUTURES: UP 25 POINTS MONDAY. TALK WAS THAT PERCENTAGE BULLISH NUMBERS WERE DOWN TO ONLY 3, WHICH TENDS TO CAUSE SOME SHORT COVERING. WEATHER IS STILL FAVORABLE FOR COTTON, BUT THE DRY AREAS ARE EXPECTED TO INCLUDE THE DELTA. RATINGS ON MONDAY NIGHT SHOULD BE ABOUT UNCHANGED. IDEAS ARE THAT CONGRESS WILL INCREASE PAYMENT LIMITS DUE TO LARGER LDP PAYMENTS. THAT PROVIDES SUPPORT TO COTTON.

DAILY TECHNICAL COMMENTS 07/23/99: NOT ISSUED FRIDAYS.

WEEKLY TECHNICAL COMMENTS

FOR THE WEEK OF 07/26-07/30: CORN:

OVER THE PAST WEEK, IDEAS FOR THE CROP SIZE ARE SMALLER, AND FUNDS COVERED SOME OF THEIR RECORD SHORT POSITIONS. THE 4-DAY MOVING AVERAGE CROSSED OVER THE 20-DAY AT $2.0975 AND THE DEC REACHED THE 50-DAY MOVING AVERAGE $2.23. RSI HAS MOVED UP TO NEAR 50 ON THE REBOUND. SEASONALS ARE DOWN INTO SEPT-OCT. SUPPORT ON THE DEC IS $2.02, THEN $1.80, RESISTANCE AT $2.26, THEN $2.50. DEC CORN TREND: NEUTRAL. SUPPORT $1.80, RESISTANCE $2.50.

FOR THE WEEK OF 07/26-07/30: BEANS:

MOVING AVERAGES TURNED UP ON NOV BEANS AS THE FOUR-DAY CROSSED OVER THE 20-DAY AT $4.37. PRICES ARE ABOVE THE 50-DAY AT $4.61. MOVING AVERAGES MOVED HIGHER FOR MEAL ALSO, WITH THE 50-DAY AT $136.00. FOR OIL, THE FOUR-DAY IS CROSSING OVER THE 20-DAY, BUT THE 50-DAY IS $17.38. RSI IS UP AS PRICES REBOUNDED. SUPPORT ON NOV BEANS IS $4.26, THEN $3.73, RESISTANCE IS AT $4.78, THEN $5.31.

MOVING AVERAGES ARE TURNING UP FOR WHEAT ALSO. THE 50-DAY IS $2.77 ON CHICAGO DEC. RSI IS STILL IN THE 40'S. SEASONALS ARE UP AFTER AUGUST. SUPPORT ON CHICAGO DEC IS $2.59, THEN $2.39, RESISTANCE AT $2.79, THEN $3.00. SUPPORT ON KANSAS CITY DEC IS AT $2.82, THEN $2.66, RESISTANCE IS AT $2.98, THEN $3.14. SUPPORT ON THE MINNEAPOLIS DEC IS $3.35, THEN $3.25. RESISTANCE IS AT $3.44, THEN $3.54.

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